Chavez Lowers Oil Payments For Caribbean Nations

Venezuelan President Hugo Chavez on Sunday touted a pact delivering fuel to Caribbean nations and loosened the financing terms to aid countries struggling with high oil prices.

Chavez said nations taking part in the Petrocaribe initiative will now be required to pay just 40 percent of the bill within 90 days — down from the current 50 percent. He said the rest can be paid over the next 25 years at a fixed interest rate of 1 percent as long as oil prices are above US$100 a barrel.

“That could compensate for the horrible curve of the jump in oil prices,” Chavez said.

He added that 70 percent of payments may be deferred if oil rises above US$200 a barrel.

Chavez said Venezuela aims to continue strengthening the Petrocaribe accord and make it into an “anti-hunger shield” for countries in the Caribbean and Central and South America.

Three years after Petrocaribe began, though, figures released by officials show the initiative is still not operating at full strength because of transportation and storage problems.

Oil Minister Rafael Ramirez said member countries other than Cuba are receiving a total of 86,000 barrels of oil a day — significantly less than their quota of 125,000.

Ramirez said Venezuela expects performance will improve with the expansion of an oil distribution network in the Caribbean.

St. Vincent and the Grenadines expects to complete construction of a storage facility next year with Venezuelan help, allowing it to boost the 300 barrels a day it currently receives — less than a third of its Petrocaribe quota, said Thornley Orsino Myers, who heads a St. Vincent electrical utility and accompanied his country’s delegation.

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